One of Austin’s last undeveloped tracts overlooking Lake Austin, which was owned for a quarter-century by Exxon Mobil Corp., has been purchased by a well-known Austin entrepreneur.
Jonathan Coon confirmed to the American-Statesman that he and his wife, Kirsten, are now the majority owners of the 145-acre wooded property, which sits on a bluff on Shepherd Mountain west of Loop 360 (Capital of Texas Highway) and the Pennybacker Bridge.
The sale took place in March through an entity called Loop 360 Land LP, a Texas limited partnership.
From his dorm room at Brigham Young University in 1992, Jonathan Coon founded 1-800 Contacts, a business that sold replacement contact lenses for below-retail prices. Coon confirmed that he sold the company for $900 million in 2012, although he said he was only a small minority owner by that time.
In Austin, Coon is a mentor at Capital Factory, a tech startup incubator downtown, and is involved in both launching and helping startups.
Coon said he and Kirsten, who moved to Austin in 2009 and have three grown children, plan to build a family home on their new Austin property and live in a future development they envision there.
Coon said he will have to make a return on the investment to justify the substantial purchase price, but said he and his wife are committed to being good stewards of the property.
Coon said he intends to develop the property in an environmentally sound way that will leave more green space than if it were developed according to a 1986 city-approved plan that allows for 64 residential lots. Coon said the older plan could result in “every square inch” of the land being covered with development.
“We’re Austinites, and we love Austin,” Coon said. “We think there’s an opportunity to do something great for Austin that everybody’s excited about.”
The seller of the property was Luna Heights LP, a partnership between Austin-based developer Riverside Resources and international investor Eduardo “Eddie” Margain. The purchase price wasn’t disclosed.
The Travis Central Appraisal District currently values the land at $33.7 million.
Margain is still involved in the property, as a minority investor. There also is one other minority investor, whom Coon declined to identify.
Coon’s land is near 65 acres that Austin game developer Richard Garriott has on the market for $45 million.
The Coon and Garriott tracts are among several high-profile parcels that neighbors say they are keeping a close eye on as development encroaches in an environmentally sensitive part of Austin.
A lawsuit was filed last month over one planned project, the Champions tract along RM 2222. The Austin City Council last fall approved plans for a 325-unit apartment complex on the site despite the opposition of some area residents.
Coon said he has spoken to some of his new neighbors, seeking feedback about the development of his property. Coon said there are no specific plans yet for developing the property.
“Because it’s an iconic location, it’s going to be something people look at very closely,” Coon said. “We think there’s an opportunity to leave more of the space open and green than what’s in the plan. We want to do something better than that.”
Some neighbors say it remains to be seen if Coon makes good on that claim.
“We’re very interested to see what ‘better,’ ‘green’ and ‘environmentally friendly’ looks like,” said Jim Rumbo, president of the Westminster Glen Homeowners Association. “All those are buzzwords, but they are not explicit. They are different in everyone’s mind.”
Coon said he has followed the property for years. The land has an intriguing history. Through an entity of another name, Exxon Mobil owned it for more than two decades, a secret guarded all those years by Austin real estate lawyer David Armbrust, who was president of the entity.
Armbrust said the plat for the land dates to the mid-1980s, and it grandfathers the tract from most, if not all, current development ordinances.
“The plat is unusual in that it allows two residences on most of the lots, so it could be developed for approximately 130 homes,” Armbrust said. “Except for minor adjustments, the development must follow the plat or the grandfathering may be lost.”
If the land use is changed going forward, Armbrust said, the number of vehicle trips generated by a proposed new project would be a key issue.
“When Exxon acquired the property in 1989, traffic impact was not even on anyone’s radar screen,” Armbrust said. “Now, it is undoubtedly the most crucial issue facing any new development in that area.”
Some residents couldn’t agree more.
“We are waking up out here,” said Linda Bailey, a Glenlake Neighborhood Association board member. “We are concerned that they are building this area out, and are not putting the proper infrastructure on the road. Without safety improvements, they’re just setting up another area that is going to be unsafe for us and our kids.”
Bailey said she is encouraged by Coon’s willingness to meet with residents, saying “he presents himself as a good neighbor who wants to fit into the community.”
“He started on the right foot,” Bailey said. “He didn’t send some high-paid lawyer to try to bulldoze us. He came personally … and he listened. He thinks there’s a better way to do things. He understands the power of negotiation and consensus-building and how to get effective change done.”
Like Bailey, Carol Lee, a member of the Glenlake Neighborhood Association, said she and other residents understand that “people have a right to develop their property.”
“It just needs to be done sensibly, with consideration to the environmental concerns,” Lee said.
Austin City Council member Alison Alter, who represents the district that includes the Coons’ property, said: “As we await the filing of official site plans, I join the neighbors in having cautious optimism that Mr. Coon will continue to operate with the kind of cooperative spirit that we need from all developers. He has communicated an appreciation for the local landscape and the importance of making it accessible both to the community he will build and the community that is already there.”
Coon said he and his wife’s vision for their land will respect the property and the nearby neighborhoods.
“We like to go for walks … and we want to have a good relationship with our future neighbors,” Coon said. “We’ll figure out a plan that will work and addresses their concerns. We are committed to meeting with neighbors first before we present anything to the city.”